Economic Deluge - Economy Shows Some Positives

Today was an economic data dump day from jobless claims, to inflation to economic activity.   I just wanted to touch on a couple of the reports that were just glaring with anomalies that we expect to be correcting in the coming months ahead.  While the data is showing the economy hanging in there for the moment there is not much chance the somehow the U.S. can effectively decouple itself from the rest of the globe.  China's flash PMI just came in at a contractionary level of 49, Europe is already in a recession it is just a question of how bad it will be and negative net export prices doesn't bode well for the U.S. economy.

Jobless Claims

First, there is always a bit of disconnect between the "initial jobless claims" and the "unemployment number" as reported by the government.   Initial claims are calculated from the number of people that file for state unemployment benefits whereas the "unemployment report" is calculated by a survey of  60,000 households each month.   The complete explanation is here.   Therefore, this is why there tends to be a disconnect between initial jobless claims averaging 363,000 a week for the last 4 weeks, or 1.3 million new jobless individuals, versus employment "growth" as reported by the government.

The most recent report showed a drop in the number of initial claims to 366,000 from the upwardly revised 385,000 in the previous week.   This brings the 4 week moving average down to 363,285.   The declining trend over ...